Q: What are some signs that you are being drawn into a health insurance scam?
A: Health insurance scams are on the rise as confusion reigns over health care reform and premiums (for those who don’t qualify for ACA subsidies) trend upwards into unaffordable territory. Premium subsidies have grown each year since 2014 to keep pace with rising premiums, and they keep after-subsidy premiums at an affordable level for those who are subsidy-eligible.
But for those who have income over 400 percent of the poverty level, and for people caught in the Medicaid coverage gap in states that haven’t expanded Medicaid, and for people impacted by the family glitch, the cost of coverage can be untenable. It’s those people who are sometimes targeted by health insurance scams.
“Passage of the legislation designed to protect consumers ironically has given criminals ideas for schemes to swindle uninformed consumers,” says healthinsurance.org founder Charles Smith Dewey. “Now, more than ever, it’s ‘buyer beware.'”
You can avoid being a victim by watching for obvious red flags:
- Watch out for aggressive sales pitches that promise full health coverage if you “act now.”
- Don’t accept unsolicited insurance offers made by fax, phone, or e-mail
- Don’t provide bank account or credit card numbers to “get locked into” coverage.
- There is no “Obamacare” plan marketed or sold by the federal government. The term “Obamacare” is just another name for the Affordable Care Act itself. The plans that are available through the exchanges and directly from insurers are not called “Obamacare.”
- Understand that there are alternatives to ACA-qualified coverage — which may or may not be a good fit, depending on your circumstances — and they are not necessarily scams. But if you’re planning to buy coverage that’s not compliant with the ACA, you need to be especially careful to read the fine print and keep in mind that in general, you get what you pay for. If it sounds too good to be true, it probably is.
To avoid getting conned, call your state’s insurance department and ask if the company or agent is licensed to do business in the state and if any action has been taken against them.
Read more about health insurance scams.